Oil palm plantations on peatlands present challenges for water quality and biodiversity, impacting ecosystem health. Management practices in these plantations, herewith referred as buffer, modified buffer and main drain management, are essential in regulating water quality and supporting aquatic biodiversity while sustaining high yields. This study evaluates these practices within the Sabaju Oil Palm Plantation in Bintulu, Sarawak, Malaysia, using water quality parameters and aquatic insect diversity as indicators. Physicochemical parameters, including temperature, dissolved oxygen (DO), biochemical oxygen demand over 5 days (BOD5), nutrients, chlorophyll-a, and total dissolved solids (TDS), were measured concurrently with aquatic insect sampling in April and September 2023. Malaysian biological indices Biological Monitoring Working Party Malaysia (BMWP-My) and Malaysian Family Biotic Index (MFBI) were calculated and compared with water quality data. A Generalised Linear Model (GLM) assessed the relationships between aquatic insect abundance and water quality. Results showed that buffer-managed sites maintained higher water quality, with lower temperatures, higher DO, lower nutrient levels, and a greater diversity of sensitive insect families, such as Hydropsychidae and Baetidae. In contrast, tolerant taxa like Chironomidae dominated modified buffer and main drain areas. Findings underscore the importance of native riparian buffer zones in safeguarding water quality and supporting aquatic diversity. The study suggests maintaining forest strips along waterways to mitigate the impact of oil palm plantations, illustrating the value of integrating biological and physicochemical measures in sustainable peatland management.